How and When to Leverage an Interim Executive

Fast Company’s 1997 article by Daniel Pink, “Free Agent Nation,” reads like an Orwellian novel with its prediction of the morphing workplace. The self-employed, the independent contractors and the temps who make up Pink’s working definition of the free agent have now progressed to the very top of the career ladder. Interim — or temporary executives — are highly specialized professionals employed to quickly turn businesses around or provide a shot in the arm while a long-term executive is being sought.

But what is the business case for interim executives? At the macro level, the answer is business agility. Interims allow organizations to quickly add needed expertise to respond to market changes or capitalize on specific opportunities. For medium to large corporations, it also gives them the chance to act like their startup competitors, moving quickly to take advantage of innovation and sidestep prolonged, permanent staffing protocols.

A January 2013 Harvard Business Review blog post by Brad Power, Steve Stanton and Walter Popper of business education and research firm Hammer and Co. discusses the need for agility in the new world:

“Rational managers for the past 30 years have tightly focused on efficiency, cost cutting and day-to-day execution — perhaps to a fault. With increasing industry disruption, efficiency is fast becoming of secondary importance to innovation and agility.”

While companies across all industries realize the value that interim executives offer in short-term situations, organizations are discovering other reasons to turn to them. Examples include crisis management to ward off stakeholder worries when a high-profile executive steps down. Being able to quickly engage top talent with internal teams can also help the company efficiently strategize in shifting markets.

Yet when should this human capital strategy be used, and what key elements are necessary for success?

The Emergence of Interim Execs
The modern business environment has not just opened the door for alternative staffing methods — including the increase of contract workers — but has firmly propped the door open, if not removed the hinges entirely.

Nevertheless, two key events during the last 20 years point to the arrival and use of temporary talent in top slots.

Toward the end of the 1990s, companies grew increasingly concerned about the effects of Y2K and the conversion of technology. As a result, an immediate need for heads of technology and IT appeared even for organizations that hadn’t traditionally staffed those positions. It was really the first time temporary executives were broadly stepping into positions that addressed a specific, targeted task with a specific end date.

The second landmark event was the passing of the Sarbanes-Oxley Act in 2002, the result of a series of large corporate frauds in the early 2000s — namely Enron Corp., Tyco International and WorldCom.

While Sarbanes-Oxley is typically associated with finance and accounting, it also affects companies’ technology divisions with regard to the storage of electronic records. The complexities and penalties linked to the federal law made it imperative for all kinds of organizations to have a head of finance and accounting in place. It also meant that organizations needed ground cover for these positions if a seat was vacated and a lengthy recruitment search was not an option.

Attributes and Assets of a Temporary Leader
Interim executives can be viewed as consultants. They need to quickly assess the situation and determine what they need to accomplish. They are typically quick learners because they don’t have the luxury of time. Interim executives build relationships quickly and are adaptable, especially in high-pressure situations.

Still, interim executives must also be adept as leaders. The functional or project team — composed of subordinates and executive peers — are looking for near immediate leadership. Building strong relationships quickly and forging an internal network that can be leveraged to move a project or team forward is one of the most critical success factors for an interim.

It’s also important for successful short-term executives to be technically competent in their area of expertise. They need to run quick diagnostics, view the situation through a strategic lens, and holistically cast short-, mid- and longer-term strategies, all with the understanding that they will either work themselves out of a job or not be in place to execute those strategies.

The success metrics for an interim executive are different than for a permanent leader, so the onboarding process varies considerably as well. Executive-level permanent hires will take part in an extended onboarding process, often during the first 90 or 120 days. Their history, tenure and track record with their previous company are what typically make them attractive candidates. But that means that more time is required to unlearn previous behaviors and transition institutional knowledge. It also takes time to get used to a new organization and its systems.

Onboarding a permanent hire is also important for assessing cultural fit and bringing stickiness to the placement — giving it a real chance to work in light of the time and resources spent to recruit for the position.

Conversely, these aren’t considerations for an interim executive. They aren’t focused on long-term risk of failure metrics, because that isn’t the job they are brought on to do. One of the first things an interim executive might do is spot organizational or team pain points, drawing up a plan to immediately address them. It is such a noncontroversial, blocking-and-tackling approach that leads to immediate implementation and resolving such issues.

The Interim Executive Life Cycle
Often, interim executives are either entrepreneurs who sold their companies to a larger organization or “refugees” from big corporations who value the flexibility of temporary and project-based work. Typical assignments can last four to nine months, but can fall anywhere above or below this range depending on the scope and requirements of the executive’s role from point of entry to exit.

Entering the assignment: Entry typically involves both the prospective interim and the company jointly exploring the requirements for the company to be able to decide whether the executive is a good fit. Once brought on the team, it is the interim executive’s task to research the current situation to initiate a detailed plan to address it.

Julian Birkinshaw, a professor of strategy and entrepreneurship at the London Business School, recently wrote a piece for Forbes called “Interim Executives: Models of Modern Management.” It touched on the modus operandi of interim expertise:

“In a strange way, interim executives are the models of modern management because they are only there for a short while. Remember the Hippocratic Oath: ‘First, do no harm.’ Every executive, whether interim or permanent, should have these four words etched on the back of their iPhone. So when starting a new job, your first priority is to figure out what is already working — without your input — that needs to be maintained. Then, plot the minimal number of interventions you need to make to sort out the problems. In the world of management, less is more.”

Performing the role: Taking ownership of the position, interim executives must firmly manage the new role or project, find a solution and report on progress to the company. During this phase, they delve as deep into the company as necessary to achieve results quickly and use their expertise, while still remaining independent practitioners. They will need to connect with many different people within the organization on expectations and then chart a path for desired results — results that can be measured in weeks or months, not years.

Once the situation analysis is complete, there needs to be a collective understanding between company and executive as to what is “in-scope” and what is “out-of-scope” for the role.
Interim executives are hired for many reasons, but one common element is they are hired for a defined period of time — there is a defined “scope,” or set of objectives, to accomplish during their contract. The longer interim executives are in the role, the more they are asked to perform the full breadth of that permanent role. “Scope creep,” as it’s called, can occur simply because the company is used to having a salaried employee in the position.

By identifying low-hanging fruit, successful interims will be able to take fast action that will have a big impact without establishing long-term commitments that might leave a permanent executive hamstrung. It is also important that the interim executive document activities throughout the assignment to plan in advance for the eventual changing of the guard.

Exiting the position: There is a point of diminishing returns to how long an interim executive is in place, and if pushed past that point, it creates instability within the team and the organization. The objective of this position is to fill a hole and leave it in better shape than when they entered. The life cycle of the interim executive should include determining up front the duration of the engagement and the appropriate exit time and strategy.

Near the nine- to 12-month mark, interim executives become embedded in the organization’s culture and the team begins to rely on them in areas not initially envisioned. Additionally, the team, organization, executive peer group — and likely the interim executive — become ready for some permanency. If there isn’t a clear demarcation of the role at that time, the lines begin to blur, and it becomes just as disruptive when that person leaves as if it were a permanent executive.

Leveraging the talents of a seasoned interim executive can give an organization the right amount of attention on a specific area of the business. Filling a critical gap, stabilizing a team or function and accelerating business initiatives are all benefits of short-term expertise.

By understanding the attributes of a professional who fit into the corporate culture and closely managing his or her interim life cycle, an organization can expect to see quick results and a smooth transition.

Cindy Lubitz is founder and managing director of inTalent Consulting Group, a human resources consulting firm. She can be reached at